The latest trading session saw McKesson (MCK) ending at $694.70, denoting a +0.27% adjustment from its last day's close. The stock's performance was ahead of the S&P 500's daily loss of 2.24%. Elsewhere, the Dow lost 1.73%, while the tech-heavy Nasdaq lost 3.07%.
The prescription drug distributor's stock has climbed by 4.72% in the past month, exceeding the Medical sector's loss of 7.47% and the S&P 500's loss of 4.17%.
Market participants will be closely following the financial results of McKesson in its upcoming release. The company plans to announce its earnings on May 8, 2025. The company's earnings per share (EPS) are projected to be $9.81, reflecting a 58.74% increase from the same quarter last year. Alongside, our most recent consensus estimate is anticipating revenue of $93.7 billion, indicating a 22.72% upward movement from the same quarter last year.
Investors should also pay attention to any latest changes in analyst estimates for McKesson. These revisions help to show the ever-changing nature of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.26% lower within the past month. Currently, McKesson is carrying a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that McKesson has a Forward P/E ratio of 18.94 right now. Its industry sports an average Forward P/E of 16.74, so one might conclude that McKesson is trading at a premium comparatively.
We can also see that MCK currently has a PEG ratio of 1.34. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. As the market closed yesterday, the Medical - Dental Supplies industry was having an average PEG ratio of 1.73.
The Medical - Dental Supplies industry is part of the Medical sector. This industry, currently bearing a Zacks Industry Rank of 90, finds itself in the top 37% echelons of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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McKesson Corporation (MCK): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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